Das said, “MPC decided to focus on withdrawal of accommodation to keep inflation within target while supporting growth”. RBI MPC revised the Marginal Standing Facility (MSF) and bank rates to 5.65 per cent from 5.15 per cent, announced Governor Das.
The central bank’s rate hike, the third in the current financial year, came in a bid to tame the inflationary pressure and protect against further rupee depreciation. In its off-cycle monetary policy review in May, the RBI had hiked the policy repo rate by 40 basis points or 0.40 per cent to 4.40 per cent. Then in June, the RBI further raised the rate to 4.90 per cent, a 50 basis points increase.